$645M in Longs Liquidated as Bitcoin Drops to $88K — Leverage Cascade Begins

Bitcoin faced one of its most aggressive leverage resets this month as over $645 million in long positions were liquidated within 24 hours. The drop to $88,000 triggered a chain reaction across major exchanges, raising fears that a deeper correction may follow.

Leveraged Positions Trigger a Major Shakeout

According to fresh liquidation data, Bitcoin’s sudden decline to $88K set off a rapid-clearing event across futures markets. Longs accounted for the overwhelming majority of liquidations, signalling that over-leveraged traders were caught off-guard.

Analysts note that this liquidation wave resembles earlier stress events where excessive leverage built up silently until a price shock forced mass unwinding.

You can follow more market updates inside our dedicated Bitcoin News section.

How the Liquidation Cascade Unfolded

Platforms with the Highest Long Wipeouts

Data referenced in the report shows liquidations spread across major derivatives platforms:

• Binance
• OKX
• Bybit
• Deribit

While short positions were also affected, the overwhelming dominance came from long-side leverage. Analysts highlight that traders frequently increased exposure during recent dips, expecting a quick rebound.

However, the combination of macro uncertainty + ETF outflows + tech-sector weakness created a perfect storm for forced exits.

Correlation With Macro Shocks

The liquidation cascade did not happen in isolation. It coincided with:

• Cooling expectations for Federal Reserve rate cuts
• Broad tech-sector weakness
• A surge in U.S. Treasury yields
• Heavy spot-Bitcoin ETF outflows

These conditions strengthened downward pressure on BTC and accelerated forced selling.

ETF Outflows Deepen Market Fragility

Spot Bitcoin ETFs have experienced an unusually high level of redemptions during November. Institutional outflows amplify market risk because they remove steady demand that normally cushions volatility.

Recent data highlighted billions leaving U.S. Bitcoin ETFs — weakening market structure and reducing liquidity, widening price swings during sudden moves.

These structural pressures, combined with leverage wipeouts, create a feedback loop that can prolong downside momentum.

Read more institutional insights in our Bitcoin News section.

What This Means for Traders, Miners, and Long-Term Holders

Short-Term Traders

For traders operating with leverage:

• Expect wider wicks and unpredictable volatility
• Reduce position sizes
• Avoid overexposure during macro events
• Monitor open interest for signs of new leverage buildup

Miners Under Pressure

Mining breakevens remain tight while electricity prices rise globally. Prolonged price weakness could hit miner profitability.

Long-Term Holders

Despite short-term volatility, long-term BTC holders often treat liquidation events as consolidation phases. Historically, heavy long wipeouts preceded medium-term recoveries as market leverage reset.

But with ETF outflows rising, caution is warranted.

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